Vulnerable people ‘may be missing out on better current account deals’
A survey for the Current Account Switch Service spoke to 1,000 people (Yui Mok/PA)
Financially vulnerable people could be missing out on getting a better current account deal due to fears around switching, research suggests.
People who are financially vulnerable are more likely to fear that they could be rejected by a bank and to worry about getting the same overdraft facility than other customers, a survey for the Current Account Switch Service (Cass) found.
Those deemed by researchers as financially vulnerable may have taken out high interest loans before, are struggling with debt, have little to no savings, have no regular income, or sometimes struggle with bills.
To embed, copy and paste the code into your website or blog:
The paper identifies potential gaps in protections for consumers, with a focus on consumer-to-business payments via the Faster Payments System.
In November, Pay.UK, the retail payments authority, released a summary paper exploring the consumer protection landscape relating to disputed retail payments.
The paper, titled “Consumer Protections in Payments”, was released in the context of changes in the usage of Pay.UK’s systems following recent regulatory developments, including the EU’s revised Payment Services Directive (2015/2366, known as PSD2) and the Open Banking initiative in the UK. Focusing in particular on real-time consumer-to-business (C2B) payments using the Faster Payments System (FPS), the paper explores the protections currently in place and consumers’ understanding of those protections. Together with ongoing primary research, the paper will be used to inform further policy work by Pay.UK and, pote
Surveys and Reports
Regulatory Developments
United Kingdom: HM Treasury consultation on new special administration regime for payment institutions and electronic money institutions
On 3 December 2020 HM Treasury (HMT) issued a consultation on proposed insolvency changes for payment institutions (PIs) and electronic money institutions (EMIs), including a bespoke special administration regime (SAR). HMT notes the shortcomings of the current insolvency regime and is making these proposals ahead of the conclusion of the Payments Landscape Review to protect consumers in the event of the insolvency of PIs and EMIs.
The proposed SAR is intended to have the following key features:
An explicit objective on the special administrator to return customer funds as soon as reasonably practicable.